Limit TINY Rewards Locking & Stop Reinvestment at 25% APR to Foster Ecosystem Liquidity

Hello! Welcome to the forums.

First I would avoid a vote button in the discussion thread. This is for feedback and refinement to ideas. A Governance Poll vote would be put in the Governance Proposals category should it move forwards, with a link to this discussion thread.

Governance Proposals - Tinyman Governance Forum

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On to the discussion part!

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A lack of use for tiny in circulation and being dumped instead has already caused significant loss of value for the token. I would note that limiting rewards from locking tokens – (the only long-term method we have to restrict Tiny supply other than our BBB program) does not exactly help the value or the scarcity of Tiny. That could just encourage others to stop locking Tiny all together or extending their lock duration.

Locking Tiny-paired LPs might be a more beneficial solution (with half the amount being added to a users tinypower at the time of lock). Encouraging both long-term tiny-paired LPs as well as increasing the amount of tiny that is locked for a long period of time to stabilize price action and deeper tiny-LP liquidity.

Even with an astounding 48.33% farm and a 5.74% pool the tiny/goBTC LP has only some $3,000 more locked in Cycle 21 (with 53 participants) than was locked in Cycle 20 (with 52 participants) when it featured a mere 20.18% farm. I myself make up over 8% of the pool and will withdraw it all for a gov lock should I reach around 50% of the LP, but I’d much prefer to build a substantial commitment in important Tiny paired LPs, like tiny/Algo, tiny/goBTC and tiny/USDC LPs and lock them into governance for additional tiny power equal to the Tiny share of the LP at time of lock.

That encourages long-term liquidity in important tiny pairings that can help offset sell pressure as well as help tiny price appreciation when BTC is on a bull run.

Example: I would personally like to build far deeper liquidity in the tiny/gobtc LPs but rewards themselves don’t really seem to draw much. My solution is to simply withdraw my position as tiny, locking it, then funneling rewards back to the LP and farming the tiny back into it. Rinse-repeat.

However I’d be equally willing to build a large Tiny/gobtc position (lets say I added 7 million tiny paired with goBTC), and as long as I can still farm it while it’s locked (maybe by auto-adding vaulted LP positions to applicable farms if they get the vote without having to recommit them to a new farm).

That would ensure larger liquidity in the tiny LP and ensure it stays in the LP for years. It would run the risk of votes not coming for future farming cycles, but that would imo only encourage more tiny locked to ensure a farm for the LP. It also adds yeild from the pool itself regardless of if and when farms are voted for the particular LP.

This subject has come up before: Allowing $TINY LP’s to be used within TM Governance

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